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© KYODOTax hike adds to woes for low-income households in Japan
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therougou
Wanna save money? Stop popping out babies!
Dango bong
"Tax hike adds to woes for low-income households in Japan"
ya think?
Chip Star
"Japan has given preferential treatments to the strong by lowering the maximum rate of income tax and corporate tax, and it has raised the consumption tax to make up for the loss, and as such is not acceptable to the people," Inomata said.
Too right.
vanityofvanities
Consumption tax is a sure way to collect taxes. Income tax is dodged by corporations and individuals.
Yubaru
You have a 24 year old, living at home, are getting subsidies from the government for the children, until they are at least teenagers, and while things might be tight, you DO have options!
What about having the 24 year old WORK and pay room and board?
I wonder how many times a year you take your kids to Disneyland!
JJ Jetplane
@therougou
Don't judge them. They are doing their part to repopulate Japan.
The tax increase is ridiculous and unjustified. Most things in Japan are unaffordable by basic people and this tax increase furthers that when you factor in that corporations had their taxes reduced as well as those among the top 1%.
kurisupisu
Taxing food?
Because the poor don’t have to eat?
I hear restricting calories leads to longer lifespans...
Speed
The other day there was a report on here about 70% of Japan's politicians have a history of nepotism involved. Many of these people have no idea about the plight of the working poor. They've never experienced it.
Yet they pass these inane laws (lowering corporate tax rates; raising the sales tax and raising them in a convoluted way; barely raising the minimum wage etc.) that hardly helps the majority of the populace.
Just make food, including convenience store's, non-taxed. Make everything else, including restaurant's food 10%, period.
Capuchin
They should implement a VAT system like a lot of other countries. High taxes on luxury items and low tax on essential items.
The idea that you pay the same amount of tax on 50inch flat screen TV or a vintage bottle of wine as you pay on provisions like rice and toilet paper is ridiculous.
mu-da
Abenomics. Increase taxes for the working population, lower the corporate tax.
Do the hustle
And, due to stagnant salaries and 60% of workers being on semi-permanent or part time contracts the number of low income families is increasing rapidly. This is Abe’s third arrow, right up the butt!
Do the hustle
By the way, I learned this morning that, if you pay for your goods with a SUICA card, you don’t pay tax on it.
IloveCoffee
I very much enjoyed the yesterday morning news program on Asahi, where one of the hosts whose name i always forget said "the bottom line is that, either the welfare has to be reduced, or taxes raised". He pretty much summed it up very well. Welfare is a ponzi scheme.
Chip Star
Source?
yildiray
i just paid for my morning coffee with Suica. Price was exactly the same. Are you sure you don’t mean that charging it doesn’t incur taxes and fees?
Dennis Sawyers
The tax hike is trying to solve a problem that it will actually make worse. Japanese people simply aren't having enough babies because family formation is unaffordable for most people with a "good job." "Good jobs" are nearly all located in urban centers, keeping the cost of living high even as the countryside dries up, and most Japanese companies pay their new hires very little for years. This means that, in Tokyo, an average salaryman isn't even ready to think about starting a family until they are at least 30.
So people don't have enough kids, so the tax base shrinks. Raising the consumption tax means less kids which means a smaller tax base.
yildiray
Eight children??? This is the reason they are broke
considering Japan’s population problems, this family should be on TV as an example of one that is helping society...
Nator
Can anyone shed any light on how this 'cashless' 3%/5% discount works?
Is it something you have to sign up for somewhere (if so where)?
Do you just get an immediate automatic 3/5% discount on the price, or get some kind of points back? (in which case, is it some kind of centralized government points, or the existing card points? )
I have a Suica card, a J-Debit card and a prepaid visa card... none of which have any kind of points scheme.
Do I just use them as usual and pay 3/5% less? I can't find any clear info on how it all works.
PS/ It's the first I've heard of these 20,000 yen vouchers as well. Seems like the hometown-tax thing in that it mainly benefits people who have enough spare cash lying around to make large one-time payments in order to get a bigger benefit down the line.
Lizz
I very much enjoyed the yesterday morning news program on Asahi, where one of the hosts whose name i always forget said "the bottom line is that, either the welfare has to be reduced, or taxes raised". He pretty much summed it up very well. Welfare is a ponzi scheme.
The only long-term sustainable solution is going to involve cheaper medical interventions that allow the elderly to keep working by extending the period of good health by years or eventually even decades.
yildiray
it mainly benefits people who have enough spare cash lying around to make large one-time payments in order to get a bigger benefit down the line.
can confirm. I’m in the highest tax bracket and my family received a letter yesterday with details how to get (ours was 4000yen for 5000yen vouchers, just one child though)
Possible I’m wrong, but it doesn’t appear to be means tested
Alexandre T. Ishii
"Northern European nations have high consumption tax, but as they also provide high levels of social welfare, most people accept the burden," Explains that Japan's Abe govt. and cia. policy is to approach Scandinavian social system? Only to think about the natural disasters happening these days in Japan, tax money of come and go + national bond to increase every year is completely an absurdity. Those leaders of lip services for next elections, very few people reactions to protest against governmental system will create more poverty when the promises of the leader to hike tax won't be executed and more people to find poverty a routine. Japan to be one of the top-leader nation in G7 and this comparison with Northern European high levels of social welfare...Hmm, it's really the time to think what is this world of absurdity, when aftermath routine and political senseless is the same of the air we breath.
Aly Rustom
Abe is Japan's greatest manmade disaster
ksteer
Pretty simple really.
Food related costs are taxed at 8%.
https://cashless.go.jp/consumer/
When using cashless, the discount is only implemented by stores that have the Cashless mark and only if your payment method also supports it.
The discount can be implemented in two ways:
A point system→ you get points after the fact through your respective point system. (think reimbursement)
I.E if I use Rakuten to pay, I'll get the discount as an additional 2% ~ 5% Rakuten points
On site discount → The store just deducts a certain amount (usually 2%) from the tax.
Chain stores = 2% discount
Mom and Pop stores = 5% discount (up to)
The thing is, these stores have to register with the government in order to get this discount, so not all stores have this discount applied to them.
In regards to you, Suica has a points system. You can use the points to charge your Suica card.
Prepaid visa cards aren't applicable to the points system.
The J-Debit card is only applicable if the bank that backs the card has registered. *It seems most of them have. But you can check it here: https://cashless.go.jp/consumer/non-bin-settlement-company-typeA.html
Note: To get points back you can only use the service that the store has registered. I.E even if they accept LINE Pay, if the Cashless poster doesn't say they registered it, you won't get points back.
u_s__reamer
Consumption taxes have become the capitalists' and their politician enablers' preferred method of squeezing the masses; in Japan it's as easy as taking candy from a baby, given the gerrymandered voting system crafted by the LDP and the dis-and misinformed supine electorate that continues to take lying down whatever is dished out to them. To quote the guy with "the best tweets": Big Consequences!
daito_hak
Oh really, where were they during the last elections then?
fxgai
Why "families with children"?
I have no need of a 5,000 yen cashback, but bought my vouchers the other day. The plan is to spend as usual, but pay with the vouchers instead of cash, until the vouchers run out.
Net-net, the 5,000 yen is pocketed by someone who doesn't need it.
Such bad, ineffective policy. Well, I hope that I am in the minority and it is actually going to help people who need it (but I don't know how it will help once the vouchers have been spent).
rgcivilian1
If the government is going to keep the retirement aged working, thus still paying taxes, why even raise the tax in the first place if its too pay for supporting a system. The numbers do not add up. It's just another coverup and bogus excus to squeeze the poor and working stiffs as in the old days. The mega rich buy the laws and pay their way out with no punishment while it is much different for everyone else. The cost of getting even a hair cut is also increased, time to use my own scissors but can't afford it anymore.
re" "Japan has given preferential treatments to the strong by lowering the maximum rate of income tax and corporate tax, and it has raised the consumption tax to make up for the loss, and as such is not acceptable to the people," Inomata said."
The rich simply never pay.
kurisupisu
Cashback,Cashless, Points?
Register with a smartphone and/or computer?
Now you can be tracked and filed for suspicious behavior!
All this takes time and effort, not to mention privacy concerns so I will stick with cash
sakurasuki
Food and beverage, beside liquor they still 8%. Whatever your payment method is.
sakurasuki
Govt won't stop with mynumber from time to time they just want more than that, cashless campaign after tax hike it's easy way to do that.
fxgai
I have a different perspective that I'd like to share!
Corporations in Japan get taxed at higher rates (30%) than corporations in Sweden (22%). Hmmmm!
I don't know what Japan's 1% even is. Minato-ku residents? And where is this reduction that only some 1% of Japanese tax payers get?
darknuts
No. Octomom here is creating her own problems by having more children than she can afford to take care of. This is not only irresponsible but immoral as you are forcing children to be raised in less than ideal environments which can hinder development. It's tantamount to child abuse. Many families are poor for this reason and then they expect society to foot the bill.
sakurasuki
There are industries sector in Japan that have no bright future at all but still received govt subsidies. Also don't forget about nationalistic agenda that cost lot of money.
No Business
Anyone who has more than two children in this day and age is very irresponsible. Eight kids?!
rgcivilian1
I have a question: Why isn't the newspaper not internet online news, but actual newspaper hard copy not taxed? Everything is else is. Does it make sense to tax water from the faucet yet bottled water is not? Both are necessity items for some the faucet is just as drinkable source of life yet it is taxed? Why wasn't this issue raised by the media. I agree with the politician stating the corporate tax should be raised not lowered. The corporate greed is already out of control and either way the tax and prices still go up while the wages remain the same or eliminated altogether.
sakurasuki
It's sad to hear these stories. Lot of govt policy just missed their target, do they even care about what's really happen? Few months back Japanese FSA gave estimation on how much money retiree need in order to live their retirement and govt decide ignore it instead using it as official reference.
kohakuebisu
The measures to help the worse-off sound like they are too complicated. Just raise child benefit, already paid as cash into people's bank accounts. Don't expect people to use apps or computers or read newspapers poor people can't afford, or to put up money to get a benefit. Doing it that way means many of the most needy will miss out.
I don't like tax increases, but Japan has a lot to pay for and empty coffers to do it with. As an alternative strategy, I think properly mobilizing the female half of the population would create all manner of economic opportunities and development that would support the current level of welfare, but for various reasons that does not happen. I write this during office hours with my own wife at my kids' school doing some compulsory task for a "kamameshi" cookery event.
Legrande
This is just yet another symptom of the system installed post-1945.
Get ready for more such elite-friendly measures down the line, unless people begin to wake up to how the LDP came to power and who put them there.
GW
I don't know whether to laugh or cry.....the govt is literally doing what will KILL their own country, shear lunacy!
rainyday
If you are looking to avoid hurting the poor while at the same time raising tax revenue, hiking the consumption tax is the worst way of doing so.
Income and other taxes can be varied according to levels of income or wealth so that the poorest are spared the sting. Consumption tax though hits them the hardest of all since they have no choice but to spend basically all their income on things that are subject to the tax.
The exemptions the government has created to offset the effects of the tax hike on the overall economy also for the most part don't benefit the poor. They have exemptions for house and automobile purchases which, by definition, can only be taken advantage of by people well off enough to be able to afford to buy a house or car.
And the coupons are a joke. We got them in the mail the other day. its basically just a one time 5,000 Yen giveaway, with a great deal of hassle involved for anyone who wants to get it, which is nowhere near enough to make a difference.
sakurasuki
Govt always push female in Japan by saying ridiculous thing so they have more children but in reality, once they have child various assistance that can help family to ease their burden is really needed. So far no concrete meaningful follow up to address this issue so far.
https://www.theguardian.com/world/2019/feb/05/japans-deputy-pm-blames-women-for-nations-falling-population
Hervé L'Eisa
The evidence of the foolish cost of socialism.
Alex Einz
8 children with low income.... your poverty has nothing to do with tax increase...
anyhoo.. just use cashless and there is no tax increase.
afanofjapan
I received two of the voucher sheets, since i have 2 children. My childcare costs will go down by 10,000yen a month. I stand to be much better off after this tax rise, and i suspect many others will too.
I have spoken to my friends in Australia and over there the cost of raising children is possibly 10x the cost of what i pay out of pocket, yet they do not have problems with depopulation. The problem is that society here expects parents to put their kids into expensive primary/secondary/high schools and universities, and pay for it out of their own pockets - thats the REAL childcare costs.
Jason Rigby
So they reduce tax of large business and raise tax on non food items. But you can get vouchers that when bought in bulk, you will get extra in money's worth in vouchers. So indeed it bebefits the families who own and run these business, because of the lowered tax and benefit because they can afford to buy in bulk these vouchers that have a greater buying value than what you paid for. And the rest of you can sulk.
JB
My family received one voucher, since we have a kid. However, the hoikuen fee for my 10 months old went up 1 man, so we are now paying 6 man for childcare. My city used to charge more for babies under one and it would get a lot cheaper each year after that. Now, there are only 3 categories: 0-2 years, 3 years and 4-5 years. So we’ll be paying 6 man for two more years... I guess they don’t have enough money to make childcare free for older children! I wonder what they are really going to do with all this extra tax money...
therougou
Tried to get a roll of toilet paper yesterday but they were 650yen. Everyone must have bought them before the tax hike and now the stores jacked up the price!
smithinjapan
It'll be less than a month before the government starts scratching it's head and saying, "Why aren't people spending more now that we've increased taxes? It's their DUTY!"
One funny thing about this is a saw people scramble madly to buy tissues, toilet paper, etc., at 310 yen or so per pack, and now they are 280 for at least the time being. haha.
Do the hustle
Interesting so many people are giving thumbs down on my comment about using a SUICA to avoid paying the tax increase. Did you not read the report stating that, electronic payments are exempt? Dang! People are too lazy to check facts for themselves. I saved ¥14 yen on a ¥700 purchase. You can do the math on that, if you are not too lazy.
sakurasuki
If you buy food or beverages beside liquor you'll have 8% tax.
You should read comment from @ksteer, those cashless discount only for store that accept cashless payment and those store need to do registration before eligible for giving out those discount. So not all stores, some people in Japan they can have limited option especially they are depend on supermarket near they live, whether have that offer or no.
sakurasuki
It depends on where you live, people in Japan they'll tend to shop nearby and lot of stores where they live just don't offer discount program if you buy in bulk.
sakurasuki
Not all stores have this kind of offer and it's temporary for less than one year, since it only valid until June next year. After that people realize nothing can cover that anymore. Not even cashless method of payment.
Do the hustle
oh, you mean like at convenience stores like I first posted? You will not pay the 2% tax if you use a SUICA in any store that accepts them. Is that clear enough for everybody? Gees!
TheLongTermer
yeah it bites, train fares are more, everything has changed. Where is all this money going?
Cheeba
I don't think food should be taxed at all. Saying that, at least have a tax-exemption on food and other necessities for families with 2 or more children.
Cheeba
@Do the hustle
Thanks, hustle. My local supermarket does accept SUICA.
sakurasuki
Even starting from Oct 1st food are being exempted from tax, the cost of food production and transportation are not free from tax. So just expect food price will go higher.
sakurasuki
Not necessarily only SUICA any cashless and stores that listed from link that was given by @ksteer can give rebates from 2 to 5%.
TARA TAN KITAOKA
Japan have to define low , middle and high income. then , Japan have to define the limit of personal assets. As soon as i understood the Japanese tax system 15 years ago, ( in Japan for 32 years ), there are many ways for the wealthy to escape tax. Some very wealthy people even live in the japanese goverment owned falts/ japanese public housing but drive great cars, dine in great restaurants and purchase unseen items to keep their tax low. Or some even try to say that they are poor and live on their friends. There are many kinds of people around japan and in the world.
sakurasuki
After seeing what happened when they reject FSA recommendation and how they treat erroneous labour data, if in the future they publish low,middle and high income definition, they might want do that because make them looks good not because they want to know the truth.
https://www.reuters.com/article/us-japan-economy-wages-error/japan-wage-data-credibility-in-doubt-over-erroneous-sampling-idUSKCN1P30M7
rgcivilian1
It is really sad that the voice of the poor are not heard in Japan. The voice of the people is clearly suffering with what was once promised a 3% tax which is now at 10% and the corporations pay little to nothing. Also amongst that is 318.45 million yen worth of gifts 20 people at Kansai Electric received, the largest amount of 123.67 million yen went to managing executive officer Satoshi Suzuki, followed by 110.57 million yen for former deputy president Hideki Toyomatsu, and yet will not step down. Clearly if they can profit why are they receiving pension plans. Surely they dont' need it as life money do they? Once again the rich get away and the working poor pay the price in higher taxes, higher prices and lower to no wages.
Open Minded
Japanese people have just re-elected the same same staff knowing what will happen with the consumption tax.
They must be happy then, no?
TheLongTermer
Well I like giving, for ex. 110 yen instead of 108, which is a hassle to make change etc. Not a big deal until you get into big numbers, then it really starts to hurt.
who is getting all this tax money?
vic.M
The consumption tax raise is not the problem. Low wages eg. minimum wage is the problem people with higher incomes can afford the tax. NZ for example has 15% tax but public hospitals are free, pension is funded out of the tax take, there is accident compensation, no compulsory health payments- you can join your own health payments system, food is cheap, welfare for poor and disadvantaged people is very good. A newly introduced system of quite a large rebate on winter power charges for everyone.
It is not he government that produces tax money. It is the workers who pay the taxes so it is only right that the government give back to their citizens in meaningful ways.